Unconventional oil and gas activity is already revolutionizing America's energy future and bringing enormous benefits to its economy, Director of Consulting Energy and Natural Resources at IHS Jerry Eumont said. Net petroleum imports have fallen from 60 percent of total consumption in 2005 to 42 percent in October 2012.

The recent surge in unconventional oil and gas and its effect in the United States was the topic of discussion at the American Petroleum Institutes (API) Houston Chapter luncheon Tuesday.

U.S. oil production, which has risen 25 percent since 2008, reached about 8.5 million barrels per day in 2012, Eumont said.

Tight oil is contributing the most to this increase due to recent advances in energy development. Unconventional natural gas is also contributing to the transformation in the natural gas market. A dozen years ago, shale gas production was only 2 percent of the nation's total natural gas production but represents 37 percent today.

This "renaissance" in the nation's unconventional market means an increase in employment  about 1.7 million jobs were created in 2012, Eumont noted. This number is projected to increase to 2.9 million jobs by the end of the decade and 3.4 million in 2035.

"Job creation in the shale plays is occurring in the oil company and service side, but is also occurring throughout the regions that have active plays," said Eumont. "Hotel, restaurants, construction, etc. are all benefiting from this activity. The impact as it trickles down is tremendous."

Unlocking unconventional energy will generate millions of jobs and billions in government receipts, Eumont added.

This energy renaissance is expected to make significant contributions to the U.S. economy through direct employment, its many and diverse connections with supplier industries, the amount of spending this direct and indirect activity supports throughout the economy, and the revenues that flow to federal and state and local governments.

IHS expects substantial growth in capital expenditures and employment to occur in support of the expansion of production within the unconventional sector:

More than $5.1 trillion in capital expenditures will take place between 2012 and 2035 across unconventional oil and natural gas activity, of which:

Over $2.1 trillion in capital expenditures will take place between 2012 and 2035 in unconventional oil activity

About $3 trillion in capital expenditures will take place between 20102 and 2035 in unconventional natural gas activity

On average, direct employment will represent about 20 percent of all jobs resulting from unconventional oil and natural gas activity with the balance contributed by indirect and induced employment

By 2020, total government revenues will grow to just over $111 billion

In 2012, unconventional energy activity supported over 360,000 direct jobs, over 537,000 indirect jobs in supplying industries, and over 850,000 induced jobs  a total of more than 1.7 million jobs in the lower 48 U.S. states

EIA expects U.S. crude oil production to continue to grow rapidly over the next two years, increasing from an average 6.4 million bbl/d in 2012 to average 7.3 million bbl/d in 2013 and 7.8 million bbl/d in 2014. Central to this projected growth will be continuing development of onshore basins. Drilling in tight oil plays in the Williston, Western Gulf, and Permian Basins is expected to account for the bulk of forecast production growth over the next two years.

Alaskan crude oil production reached a seasonal low last year of 400,000 bbl/d in August 2012, when summer maintenance typically decreases volumes, but recovered to 550,000 bbl/d in October. EIA expects Alaskan crude oil production will decline from an average of 530,000 bbl/d in 2012 to 500,000 bbl/d in 2013 and 470,000 bbl/d in 2014.

U.S. federal Gulf of Mexico (GOM) crude oil production averaged an estimated 1.3 million bbl/d in 2012, about 50,000 bbl/d lower than during 2011. EIA expects GOM production to increase to an average of 1.4 million bbl/d in 2013. Much of that increase is due to new projects that started producing in 2012, but continued to increase until late 2012 or early 2013, and six new field start-ups. Projected GOM production continues to increase in 2014, averaging 1.5 million bbl/d, as several relatively high-volume deepwater projects are expected onstream.

Since peaking in 2005 at 12.5 million bbl/d, U.S. liquid fuel net imports, including crude oil, have been falling. Total net imports fell to 7.5 million bbl/d in 2012, and EIA expects imports to continue declining to an average of 6.1 million bbl/d by 2014. Similarly, the share of total U.S. consumption met by liquid fuel net imports peaked at more than 60 percent in 2005 and fell to an average of 40 percent in 2012. EIA expects the net import share to fall to 32 percent in 2014 because of continued substantial increases in domestic crude oil production.

What ticks me off is that Obama and his cronies have done everything they can to curtail oil, gas and coal production in this country but you can bet they will take all the credit for all the good that will come out of this.

Also lots of decent wells were P&A when the Saudis dropped the price artificially by opening the taps years ago.Think the price came down to around $10 a barrel.A bunch of independents went out of business.Those wells are still there and could be produced with a profit at present prices.

The cost of using a rig to drill out a cemented in stripper that produced a couple barrels a day doesn’t make any sense when the same rig could be used to produce a real well, instead of one near completely played out.

When the *crunch* happened, a lot of wells in my area were P&A that were making profit at $40 a barrel.Lots of older wells were being re-logged with newer equipment that was discovering pay zones up the hole that were skipped years before (Thermal Decay Tools/Lifetime logs, big part of our business).Some older wells, 10-20 years old, were being re-worked to increase production and also figuring out where the water was coming from and if anything could be done about it remedially, also a big part of our business.That just about came to an end after the crunch and independents bit the dust (on land wells).

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